North Shore Market Watch

April 12, 2018

How do you select the members of your team who are going to help make your dream of owning a home a reality? What should you be looking for? How do you know if you’ve found the right agent or lender?

The most important characteristic that you should be looking for in your agent is someone who is going to take the time to really educate you on the North Shore home choices available to you and your ability to buy in today’s market.

As the financial guru Dave Ramsey advises:

“When getting help with money, whether it’s insurance, real estate or investments, you should always look for someone with the heart of a teacher, not the heart of a salesman.”

Do your research. Ask your friends and family for recommendations of professionals they’ve worked with in the past and have had good experiences with.

Look for members of your team who will be honest and trustworthy; after all, you will be trusting them to help you make one of the biggest financial decisions of your life.

Whether this is your first or fifth time buying a home, you want to make sure that you have an agent who is going to have the tough conversations with you, not just the easy ones. If your offer isn’t accepted by the seller, or they think that there may be something wrong with the home that you’ve fallen in love with, you would rather know what they think than make a costly mistake.

Look for someone to invest in your family’s future with you. You want an agent who isn’t focused on the transaction but is instead focused on helping you understand the process while helping you find your dream home.

Bottom Line

In this world of Google searches, where it seems like all the answers are just a mouse-click away, you need an agent who is going to educate you and share the information that you need to know before you even know you need it.

December 14, 2017

I took a quick look at three communities on the North Shore - Deerfield, Highland Park and Lake Forest. In the video below I compare what is happening in the real estate market at three different price brackets in these communities:

Homes priced under $500,000

Homes priced over $500,000 and under $1 million

Homes priced over $1 million

If you have any questions or need further information, as always, feel free to contact me. I look forward to working with you in 2018. Watch for my upcoming videos:

June 29, 2017

According to a recent report by Trulia, “buying is cheaper than renting in 100 of the largest metro areas by an average of 33.1%.” The report may have some people thinking about buying a home instead of signing another lease extension, but does that make sense from a financial perspective?

“Owning a home is one of the most common ways households build long-term wealth, as it acts like a forced savings account. Instead of paying your landlord, you can pay yourself in the long run through paying down a mortgage on a house.”

The article listed five reasons why owning a home makes financial sense:

Mortgage payments can be fixed while rents go up.

Equity in your home can be a financial resource later.

You can build wealth without paying capital gains.

A mortgage can act as a forced savings account.

Overall, homeowners can enjoy greater wealth growth than renters.

Mortgage Interest Rates are Rising

Now is the time buy a home. According to Freddie Mac, mortgage interest rates reached their lowest mark of 2017 last week at 3.89%. Interest rates have hovered around 4% for the majority of 2017, giving many buyers relief from rising home prices and helping with affordability.

While experts predict that rates will increase by the end of 2017, the latest projections have softened, with Freddie Mac predicting that rates will rise to 4.3% in Q4.

Bottom Line

Before you sign another lease, let’s get together and discuss all your options. Real estate is local and every market is different. Let’s get together to discuss what’s really going on in the North Shore area and how we can help you make the best, most informed decision for you and your family.

May 25, 2017

Summer weather is just around the corner on Chicago’s North Shore. While many people have been busy this spring cleaning the inside of their homes, it is also important to remember to address the outside as well. With the summer heat coming soon, now is the best time to make sure your house is ready for everything this year will throw at it. We have put together a list of some key spring maintenance tasks to make sure your home is, and stays, in top shape this year.

1. Check (and probably clean) the gutters.

Your gutters are important - they help protect your roof, siding, and the whole house in general from water damage that could lead to costly repairs. Beyond that, clogged gutters can lead to mold formation or an influx of mosquitoes. Thankfully, it is fairly easy to clean your own gutters, but it’s not too expensive to have a professional come in if you’d prefer that.

2. Check the foundation for holes (and fill them in!).

Sometimes holes can form near the foundation of your home, especially where pipes or wires enter. A walk-around inspection of the outside can help you find any of these holes that might have appeared over the winter. If you do find some unwanted holes, a can of spray foam can be used to fill those in and protect your house from unwanted critters.

3. While you’re checking the exterior, look at your windows, too.

Make sure your windows are properly sealed. If not, you can use some caulking or weather sealing to create an airtight and waterproof seal to protect your home for the summer. If the windows are not properly sealed, there is a chance that water could leak in or your air conditioning could escape – and no one wants that for the summer months.

4. Service your air conditioning unit.

Clean the coils and the outdoor condenser if it looks like they need to be cleaned after the winter. Check the drain line and unclog it if needed. Finally, wash or change the filters (this should be a monthly task, if you can remember it). While this can definitely be a do-it-yourself project, there are a number of professionals who can clean your AC unit for you, as well as do some extra servicing that is harder for a DIY task.

5.Protect your deck, swing set, or other wooden yard structure.

Winters can be harsh on wood structures, so make sure to take some time to care for them this spring. Constantly being exposed to the elements can cause the wood to deteriorate more quickly than it normally would. Protect your deck by staining and sealing the wood to help it withstand the harsh weather conditions.

6. Check your roof and chimney.

This might sound daunting, but it really should not be. For a basic overview, you do not even need a ladder, just a pair of binoculars. Check the roof and chimney using the binoculars from the ground. If you see something suspicious, then either use a ladder for a closer inspection or call a professional to do it for you.

7. Inspect the inside of your home for any issues.

Spring is a good time to check the inside of your house, too, not just the outside. Check your smoke alarms and carbon monoxide detectors to make sure their batteries still work. Look at all appliances, especially around the coils or vents, for a buildup of dust or anything else that looks out of the ordinary.

Use these seven tips to help get your house in order for the summer. This is just the basics, and there are plenty more spring cleaning and maintenance jobs you can do if you choose.

Feel free to contact us if you have any questions about ways to keep your North Shore home running smoothly or if you have any real estate questions we can help with.

May 11, 2017

As a North Shore Realtor, I’m obviously biased towards the suburbs. But, there’s a reason for that and it has nothing to do with selling real estate. Living in the suburbs of Chicago just has so many advantages. And, you can still have the best of both worlds, thanks to Metra. Here are the top 5 reasons to consider the suburbs for your next home.

Better schooling options: In Chicago, you have to pay a premium to get into a (small) property in one of the “good” school districts or apply to get into a magnet school. There are no guarantees you will get into that magnet school and if you opt for the higher rated private schools, the costs can be quite extensive.

Less Crime: I think it’s pretty much a given that the suburbs are going to have less crime. Some say, it’s mostly due to the fact that there are less people on top of each other. Whatever the reason, the statistics speak for themselves and it’s clear that the suburbs are “safer” than the city.

It’s less expensive to live in the suburbs. Recent studies show that living in the suburbs of Chicago can save an average of just over $18,000 per year. I’m sure you can think of many ways to spend or invest that savings- maybe for some lawn furniture since you will actually HAVE a lawn. "
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Community Involvement: The North Shore has a well-educated population and the residents are very involved in their communities.

Fun amenities: Beaches (Many people think that the beaches on the North Shore are nicer than the ones in the city.), off-leash dog parks and dog beaches, tennis courts, country clubs and golf courses (lots of these on the North Shore), Ravinia Festival (outdoor music venue in the summer in Highland Park), Chicago Botanic Garden, an assortment of bike/hike trails, and some very nice shopping malls . Old Orchard is one of the very first suburban malls in the US and is still very nice. Northbrook Court is also a popular shopping mall. And, of course some things that you also find in the city are easily available in the suburbs such as high end restaurants, coffee shops, park district programs, parks, movie theaters, shopping, tons of exercise places and nail salons, etc. The big difference is that you’ll probably use your car more in the burbs...and it is a LOT easier to find parking!!!

While enjoying all the amenities of the suburbs is great, you might eventually miss the city. Don’t worry! There are easy and comfortable Metra commuter trains to Chicago. These aren’t like the inner city trains, they are much more comfortable and pleasant. You can listen to music, scroll through Facebook or even take a nap on your way to work or a city event.

If you think a move to the suburbs is in your future, give me a call and we can discuss all your options.

May 04, 2017

Many Americans got some depressing news last week; either their tax return was not as large as they had hoped or, in some cases, they were told they owed additional money to either the Federal or State government or both. One way to save on taxes is to own your own North Shore home.

According to the Tax Policy Center’s Briefing Book-“A citizen's guide to the fascinating (though often complex) elements of the federal Tax System” - there are several tax advantages to homeownership.

Here are four items, and a quote on each, from the Briefing Book:

1. Mortgage Interest Deduction

“Homeowners who itemize deductions may reduce their taxable income by deducting any interest paid on a home mortgage. The deduction is limited to interest paid on up to $1 million of debt incurred to purchase or substantially rehabilitate a home. Homeowners also may deduct interest paid on up to $100,000 of home equity debt, regardless of how they use the borrowed funds. Taxpayers who do not own their home have no comparable ability to deduct interest paid on debt incurred to purchase goods and services.”

2. Property Tax Deduction

“Homeowners who itemize deductions may also reduce their taxable income by deducting property taxes they pay on their homes.”

3. Imputed Rent

“Buying a home is an investment, part of the returns from which is the opportunity to live in the home rent-free. Unlike returns from other investments, the return on homeownership—what economists call “imputed rent”—is excluded from taxable income. In contrast, landlords must count as income the rent they receive, and renters may not deduct the rent they pay. A homeowner is effectively both landlord and renter, but the tax code treats homeowners the same as renters while ignoring their simultaneous role as their own landlords.”

4. Profits from Home Sales

“Taxpayers who sell assets must generally pay capital gains tax on any profits made on the sale. But homeowners may exclude from taxable income up to $250,000 ($500,000 for joint filers) of capital gains on the sale of their home if they satisfy certain criteria: they must have maintained the home as their principal residence in two out of the preceding five years, and they generally may not have claimed the capital gains exclusion for the sale of another home during the previous two years.”

Bottom Line

We are not suggesting that you purchase a house just to save on your taxes. However, if you have been on the fence as to whether 2017 is the year you should become a North Shore homeowner, this information might help with that decision.

As always, if you have any real estate questions, feel free to contact me.

April 20, 2017

Self-made millionaire David Bach was quoted in a CNBC article explaining that "the single biggest mistake millennials are making" is not purchasing a home because buying real estate is "an escalator to wealth.”

Bach went on to explain:

"If millennials don't buy a home, their chances of actually having any wealth in this country are little to none. The average homeowner to this day is 38 times wealthier than a renter."

In his bestselling book, “The Automatic Millionaire,” Bach does the math:

"As a renter, you can easily spend half a million dollars or more on rent over the years ($1,500 a month for 30 years comes to $540,000), and in the end wind up just where you started — owning nothing. Or you can buy a house and spend the same amount paying down a mortgage, and in the end wind up owning your own home free and clear!"

Who is David Bach?

Bach is a self-made millionaire who has written nine consecutive New York Times bestsellers. His book, “The Automatic Millionaire,” spent 31 weeks on the New York Times bestseller list. He is one of the only business authors in history to have four books simultaneously on the New York Times, Wall Street Journal, BusinessWeek and USA Today bestseller lists.

He has been a contributor to NBC’s Today Show appearing more than 100 times, has been a regular on ABC, CBS, Fox, CNBC, CNN, Yahoo, The View, and PBS, and has been profiled in many major publications, including The New York Times, BusinessWeek, USA Today, People, Reader’s Digest, Time, Financial Times, The Washington Post, The Wall Street Journal, Working Woman, Glamour, Family Circle, Redbook, Huffington Post, Business Insider, Investors’ Business Daily, and Forbes.

Bottom Line

Whenever a well-respected millionaire gives investment advice, people usually clamor to hear it. This millionaire gave simple advice – if you don’t yet live in your own home, go buy one.

It looks like the millennials ARE taking this advice. As you can see in the chart, they are making up the majority of first-time homebuyers.

If you are looking to buy or sell a home, feel free to call me. I'm happy to assist you.

April 06, 2017

If your house no longer fits your needs and you are planning on buying a luxury home, now is a great time to do so! We recently shared data from Trulia’s Market Mismatch Study which showed that in today’s premium home market, buyers are in control.

The inventory of homes for sale in the luxury market far exceeds those searching to purchase these properties in many areas of the country. This means that homes are often staying on the market longer, or can be found at a discount.

Those who have a starter or trade-up home to sell will find buyers competing, and often entering bidding wars, to be able to call your house their new home.

The sale of your starter or trade-up house will aid in coming up with a larger down payment for your new luxury home. Even a 5% down payment on a million-dollar home is $50,000.

But not all who are buying luxury properties have a home to sell first. In a recent Washington post article, Daryl Judy, an associate broker with Washington Fine Properties, gave some insight into what many millennials are choosing to do:

“Some high-earning millennials save money until they are in their early 30s to buy a place and just skip over that starter-home phase. They’ll stay in an apartment until they can afford to pay for the place they want.”

Bottom Line

The best time to sell anything is when demand is high and supply is low. If you are currently in a starter or trade-up house that no longer fits your needs, and are looking to step into a luxury home… Now’s the time to list your house for sale and make your dreams come true. Call me and I can help!

August 09, 2016

First I am excited to share with you that @properties just won a very special award this week from Inman. (Inman is the leading independent news publisher for the residential real estate industry. In addition to producing the best news in the business, Inman also hosts the highly respected Real Estate Connect conferences where the leaders in real estate gather to network and learn about the latest in real estate technologies). Here is link to Inman Award for @properties.

You may have seen reports in the national news that real estate sales this year are up across the country. While that is true on a national basis, and even in parts of the city of Chicago, here on the North Shore the market is not following national trends. So I thought you might be interested to learn about what is going on in Highland Park and why.

All of the information that I reviewed is from the Multiple Listing Service, for single family homes in Highland Park.

First, the interesting news is that the number of homes sold during the past 12 months (as of the end of July) is about the same as it was during each of the prior 2 years. In other words, demand for homes in Highland Park is the same this year as it was last year, and the year before. There were between 410 and 416 homes sold in each of the past three years, ending on July 31st.

The flip side of this is that the number of homes available for sale during the most recent 12 months increased by over 13%! This varies by price range. Homes priced under $500,000 actually had fewer homes available for sale this year than last year. Meanwhile, the number of homes available for sale priced at $500,000 or more increased across the board, especially the luxury properties (over $1 million asking price) which had an increase of over 37%.

Usually when supply is higher than demand, prices tend to fall. That hasn’t happened (yet) in Highland Park. So far, median and average prices across the board and within specific price ranges has been fairly steady over the past 3 years. I am concerned that when all is said and done, that we may see some declines in prices by the end of the year. There are many homes on the market now that have not sold yet, and as the summer draws to a close, sellers will be encouraged to reduce their price in order to get their homes sold so that they can move on with their lives.

Homes under $750,000 are experiencing a “balanced market” favoring neither the buyers or sellers. Homes over $750,000 are clearly experiencing a buyer’s market with 10 – 20 months of inventory available, depending on the price range.

Why is Highland Park, and the rest of the north shore, not following the national trends? It is all about demographics:

We have disproportionately high number of baby boomers, and even some of their parents, still living in their homes on the north shore. The baby boomers are becoming empty-nesters and/or discovering that they are no longer "upside down" on their homes. And, their kids are finally moving out. This is why the number of homes available for sale has increased.

The children of the baby boomers, the millenials, are not rushing out to buy homes on the north shore. Many are staying in the city. Many are still renting. And, the majority of those that are buying homes can't afford the more expensive homes on the north shore. And, to top it off, they want everything to look brand new (new construction or complete gut rehab). This is affecting demand - the millenials can't afford or don't want the homes that are available for sale.

If you are ever curious about the price of a property for sale anywhere in the Chicago area you can use my new app for your phone. Go to www.karpsearch.comon your phone. Then click on the link to go to your app store (both android and iPhone systems are supported). It is easy to use for a one-time look, and you can even set up and save searches – you need to create a username and password if you are going to save your search.

Or, if you just want to see what is on the market in Highland Park, I have two permanent searches that are updated daily. You can click on these links any time to see the full details on homes or condos/town homes for sale in Highland Park:

January 09, 2015

This is a high level recap of the Highland Park real estate market in 2014, and what I think it means for the months ahead.

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The number of single family homes sold in Highland Park during 2014declined from the prior year. On the surface, this sounds like it couldbe bad news, but I don't think it is. The underlying trends are verygood.

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This chart shows the same info as the previous one, except it is broken out into price ranges. Interestingly most of the decline inthe number of homes sold are for homes valued under $500,000. Sales ofhomes between $500,000 and a million dollars INCREASED during 2014. Why? Readon...

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Using sales info on homes that sold, we can estimate how long it will take to sell the current inventory of homes available. This is called "months supply." When months supply is 5 - 7 months we have a balanced market - it doesn't favor the buyers or the sellers. HP appears to be a balanced mkt.

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When we look at months supply within price range, we see what is really going on in HP. Homes priced under $500,000 it is sellers market - demand exceeds supply and homes are selling fast. Prices $500,000 - $1 million is balanced. Homes over $1million it's a buyers market with long market times.

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Best chart last: Average and median prices in HP increased in 2014. Based on the previous charts, this is partially due to more expensive homes sold this year than in the preceding years. (Home values are up, though not by the exact %'s on the chart.)

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What does this mean for 2015? I think demand for homes under $1million will continue to be strong and prices will continue to improve at amodest rate. Hopefully demand for luxury homes will catch up withthe supply, though I believe that prices will still be soft in that part of themarket, at least through the first several months of 2015.

Thank you for reading!!

If you’d like to understand how this information affects you and your home buying/selling decisions, contact me directly for a consultation.